Golar LNG Inks Deal on Hilli’s Dropdown

Image Courtesy: Keppel

Golar LNG, owner and operator of LNG carriers and FSRUs, together with its affiliates Keppel Shipyard and Black and Veatch, has entered into a deal to sell equity interests in Golar Hilli LLC to Golar LNG Partners.

Upon closing of the deal, which is subject to meeting of certain conditions, Golar LNG Partners will indirectly own the Hilli Episeyo, a floating liquefied natural gas vessel.

The interests represent the equivalent of 50% of the two liquefaction trains, out of a total of four, that have been contracted to Perenco Cameroon SA and Societe Nationale Des Hydrocarbures for an eight-year term.

The sale price is USD 658 million less net lease obligations under the financing facility for the Hilli that are expected to be between USD 468-480 million. In line with the deal, the Partnership paid a USD 70 million deposit to Golar, on which the Partnership will receive interest at a rate of 5% per annum.

The deal is conditional upon the consent of the lenders under the Hilli facility, the closing of the previously announced put-sale closing with respect to the Golar Tundra, the delivery to and acceptance by the customer of the Hilli, the commencement of commercial operations under the liquefaction tolling agreement and the formation of Golar Hilli LLC and the related pre-closing contributions.

The finalization of the sale is expected to occur by April 30, 2018.

The Hilli conversion is nearing completion, which remains under budget, with the vessel’s naming conducted in July. All equipment has been installed and pre-commissioning work is well underway, the company said.

Golar added it was doing as much testing as possible in the yard and at anchorage in order to minimize the risk of issues being encountered in Cameroon. The extra days spent in Singapore are expected to reduce the time required for commissioning on site.

The converted vessel is scheduled to leave Singapore for Cameroon at the end of September or beginning of October. The mooring system has been installed in Cameroon and is ready for the hook-up of Hilli. The voyage between Singapore and Cameroon is expected to take 32 to 40 days.

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